posted at 8:40 am on February 4, 2011 by Ed Morrissey

The jobless rate fell by four-tenths of a point in January to 9.0%, the best downward revision in the post-recession environment, but it didn’t actually mean that the economy added more jobs. The number of jobs added overall was only 36,000, which indicates that people are still fleeing the job market:

The unemployment rate fell by 0.4 percentage point to 9.0 percent in January, while nonfarm payroll employment changed little (+36,000), the U.S. Bureau of Labor Statistics reported today. Employment rose in manufacturing and in retail trade but was down in construction and in transportation and warehousing. Employment in most other major industries changed little over the month.

The unemployment rate (9.0 percent) declined by 0.4 percentage point for the second month in a row. (See table A-1.) The number of unemployed persons decreased by about 600,000 in January to 13.9 million, while the labor force was unchanged. (Based on data adjusted for updated population controls. See table C.)

Frankly, this doesn’t make a lot of sense. If only 36,000 jobs were added and 600,000 people stopped being unemployed, then the labor force should show a significant contraction. The lower overall rate makes sense if 600,000 people left the workforce, but not if the workforce remained the same. Otherwise, we’d have to conclude that 36,000 jobs represents 0.4% of all employment in the US.

Looking at the A-6 table, which compares numbers January 2010 to January 2011 (not seasonally adjusted), we can see that the unemployment rate for those without disabilities has dropped from 10.4% to 9.7%. The number of non-disabled adults outside the work force has grown substantially in that period, from 62.8 million to 64.7 million. That far outstrips population growth and indicates that people are still leaving the work force in large numbers. In the A-16 table for the same period (not seasonally adjusted), the number of people outside the workforce has grown from 83.9 million to 86.2 million, again showing a large increase.

The topline rate number looks better, but it also looks increasingly irrelevant. The Department of Labor shows that the average monthly growth of jobs over the last 12 months has been 97,000, not enough to keep up with population growth. That’s the key measure, and it’s simply not getting any better, nor any more consistent.

The government noted that severe weather could have affected construction payrolls, which dropped 32,000 last month. There were also large declines in the employment of couriers and messengers.

Maybe we need some global warming, eh?

Update II: Zero Hedge notes that the U-6 number went from 16.6% to 17.3%. He also catches something I missed — the civilian labor force dropped from 153,690,000 in December to 153,186,000 in January after a recent November peak of 153,950,000. That was a drop of 504,000 in January from December, and 764,000 in two months. The participation rate dropped from 64.5% in November to 64.3% in December and 64.2% in January.

Update III: Suitably Flip e-mails:

1) On the 504,000 decline – as you may have seen, that’s due to a Census adjustment:

“The adjustment decreased the estimated size of the civilian noninstitutional population in December by 347,000, the civilian labor force by 504,000, and employment by 472,000; the new population estimates had a negligible impact on unemployment rates and most other percentage estimates.”

The same adjustment decreased payrolls by 472,000 (i.e. the “disappeared” people had an unemployment rate of just 6.3%, so the remaining population should’ve ticked up). Excluding the Census data, the labor force was unchanged, so I’m still trying to crunch these numbers and get them to agree with the decline in the headline unemployment rate.

The only thing that seems to reconcile the numbers is to (improperly) fail to back out the 472,000, which doesn’t have a “neligible” impact. It lowers the rate from 9.3% to 9.0%. With the seasonal and population adjustments, I’m having a hard time making complete sense of it. If that’s what they did, it was a huge mistake. Seems quite unlikely, but I don’t see how they get 9.0% otherwise.

And notably, the same estimates that were looking for 148,000 new jobs also expected an increase in the unemployment rate to 9.5%. That wild disparity (huge underperformance with a significant improvement in the rate) doesn’t make sense, absent a methodology adjustment that’s not accounted for by the Census tweak.

The “adjustment” excuse doesn’t make a lot of sense, either, except that the BLS “adjusted” nearly a half-million people out of the civilian workforce. Did the US suffer a population decline in 2010? Flip also decimates the “weather” excuse in this post.

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How long before the average American understands that any information about any topic coming from this government should be viewed with the same level of skepticism we used to have about official claims made by the USSR?

flyfisher on February 4, 2011 at 9:48 AM

THIS!! If the Obama administration doesn’t like the data, they’ll sweep it under the rug like they did when they had the CDC withold reports on abortions stats. For the past 40 years, the CDC released the reports, now they were told not to release. Odd indeed.

How long before the average American understands that any information about any topic coming from this government should be viewed with the same level of skepticism we used to have about official claims made by the USSR?

flyfisher on February 4, 2011 at 9:48 AM

Average Americans already get this.

The below average ones – you know, the ones that help keep O’s poll numbers higher than 0% – will never get it.

For those of you who equate Wall St reaction as positive or negative…..

A poor jobs report will usually have a positive effect on stocks. Not because the report is positive for the economy. BUt because it means longer periods of low interest rates. And low interest rates are good for stocks.

It is counter intuitive but in the short run, bad economic news usually means a bump for stocks.

I don’t expect our resident trolls to understand. Math is hard and stuff.

For those of you who equate Wall St reaction as positive or negative…..

angryed on February 4, 2011 at 10:25 AM

I’ve often laughed at various news reports on radio, print etc, even during the course of the same day; watch today’s web headlines, updated every so often. If the market is up, you’ll see “DOW up on unemployment report” with filler that will mention possible positives “reflects improving economy, future consumer spending, business confidence, etc”, and if it turns south, you’ll see “DOW down on unemployment report” with filler that will be a list of negatives. Same if the unemployment numbers had been higher (“DOW up because investors see businesses cutting labor costs and improving margins, etc”).

I think many of these headline writers just make crap up because they have to write *something*.

“Figures often beguile me, particularly when I have the arranging of them myself; in which case the remark attributed to Disraeli would often apply with justice and force: ‘There are three kinds of lies: lies, damned lies, and statistics.’”

~~ Mark Twain, in Chapters From My Autobiography, North American Review 186

The Dems have those out of work right where they want them, needing Government to save them. They can call the GOP evil for hating the poor folk. Tell them that if they vote GOP next year, they wont get the help they need. Get them into the trap of rather stay home and get help, then go to work. GOP will give you a job, that is just pure evil because it makes you beholden to the evil corporations, and the Jews.

I’m taking a stab at early retirement. I could get a job as a SW engineer, but I would rather try to just get by with what I have. In short, I’m tired of paying high taxes, FICA and the rest and am going Galt.

MJBrutus on February 4, 2011 at 9:35 AM

Hope it works out for you. This is another factor in such soft data.

On the upside, I haven’t heard Bammie blame President George W. Bush yet this week.

Let’s organize those 2+ million people who just stopped looking/’left the work force’ over the last year and all head for DC and have our own “Leave Now, Barrack” protests. How many total fall into this category now? 20 Million? Less? I’m not sure, but if we could organize even 10% of them and march on DC, I bet we’d see some changes alright.

The more people who are actually out of work, the lower the unmemployment percent goes according to the bureaucrats. The BLS “stats” are true Big Brother speak. Lies and half truths.

Obama: “We’re heading in the right direction. But I won’t be satisfied until the unemployment rate is 0%.”

Mr_Magoo on February 4, 2011 at 11:32 AM

Did he really say that?
You’d think the smartest man in the world would know that 0% unemployment is impossible. Even in the best economy ever, it would be at 3%. That is called natural unemployment. No matter how good the economy is there will always be unemployed people. Recent graduates from school, people switching careers, etc.

Not true at all! We need to welcome and make it much easier for talented engineers to live and stay here. Most places where I contracted in recent years have been dominated by large numbers of Indians. They’re smart and there are indeed not enough qualified engineers without them. What we need to avoid is allowing them here to get a college degree and then sending them away!

MJBrutus on February 4, 2011 at 9:39 AM

I sure hope you’re being sarcastic. Many of the folks I know out of work are engineers and if all the foreign guest workers were gone employers would be PROPERLY ENCOURAGED to drop their CRAZY laundry list requirement scam to get around the LAW.

They might also be encouraged to train people which is to their advantage.

The entire H1-B situation is a gigantic scam that no one wants to talk about.

dogsoldier on February 4, 2011 at 9:34 AM

This. Ending the H1B visa program would generate at least 200k jobs, likely much more – for Americans.

Also, we’re importing, through legal immigration, half a million a year, time for a 5-10 year immigration moratorium on all immigration. There are (conservative) estimates of 12 million illegals – build a wall and expel these people.

Then we’ll see where unemployment stands. But all this would require politicians to be serious about the economic health of the country.

Using the standard insisted on by the liberals.
President Bush had much higher NASDAQ, DOW, and S&P, and less then 5% unemployment and he was skewered by the press and the dems for such dismal performance.
That make Obama, by the liberals standards, a complete and utter failure.

“And another curiously divergent dynamic: looking simply at the Seasonally Adjusted underemployment rate (U-6), which came at 16.1%, or the lowest since April 2009, and one might be excused for assuming that there is a silver lining, somewhere. That is, of course, until taking a look at the sister, NSA [not seasonally adjusted] series. At 17.3%, this was the highest number since March 2010, and higher than just 3 months in the history of this series.”

The Seasonally Adjusted U6 went down from 16.6% to 16.1%.
The Not Seasonally Adjusted U6 went up to 17.3%.

We, the people, have a real problem. Among other outrages:
Obama and his administration lie to us constantly;
The traditional media does not call him on that;
The Republicans do not call him on that;
Obama imposes greater regulatory burdens on us and our businesses, yet the media, including the Wall Street Journal, goes along with Obama’s claim to be helping business and cutting down on red tape, and the Republicans are quiet about that;
Obama grants exemptions to his supporters from oppressive regulations, and the media and Republicans do not express outrage;
The Republicans will not axe government spending, even though the People want that.
How long can this last?

The unemployment rate (9.0 percent) declined by 0.4 percentage point for the second month in a row. (See table A-1.) The number of unemployed persons decreased by about 600,000 in January to 13.9 million, while the labor force was unchanged. (Based on data adjusted for updated population controls. See table C.)

BULL!
The number of unemployed persons DID NOT decreased by about 600,000 in January.
The number of unemployed persons who have hit and passed 99 weeksINcreased by about 600,000 in January.

If someone is no longer getting unemployment they are no longer “officially unemployed”!

A whole lot of people are going on disability and taking their Social Security as early as possible. Anyone over 60 who has been laid off in this recession has pretty much zero chance of finding a new job. They are all dropping out of the labor force.

I’m probably one of those considered “dropped out.” My last fulltime job ended in August of 2008. My unemploayment benefits ran out over a year ago. I had a consulting job for 6 months but that was canceled last June. I have had a couple of freelance writing gigs since then but that’s it.

The amazing aspect of all this, to me, is how apathetic the population has become to this Orwellian crap. As SOON as there is evidence of data manipulation, you’d think there’d be 20 reporters clammoring for an interview/statment. Instead? Crickets.

The amazing aspect of all this, to me, is how apathetic the population has become to this Orwellian crap. As SOON as there is evidence of data manipulation, you’d think there’d be 20 reporters clammoring for an interview/statment. Instead? Crickets.

Scary stuff.

KMC1 on February 4, 2011 at 1:44 PM

Until this utter failure of the press is reversed and the Ojugears administration is subject to the same scrutiny as every other administration in history, nothing’s going to change and we’ll continue this slide, all the while being fed lie after lie after lie.

Meanwhile, the executive branch is usurping more and more authority daily.

The amazing aspect of all this, to me, is how apathetic the population media has become to this Orwellian crap. As SOON as there is evidence of data manipulation, you’d think there’d be 20 reporters clammoring for an interview/statment. Instead? Crickets.

Scary stuff.

KMC1 on February 4, 2011 at 1:44 PM

Of course, if this were the Bush administration blatantly cooking the books…

Construction jobs are at the lowest I’ve ever seen them since the ’80s, at least around here. It’s bad. jeanie on February 4, 2011 at 9:26 AM

We can’t find enough contractors up here in ND.
If you want a porch built-forget it. You gotta hire some local flunky who botches the job & cahrges you by the hour while they loaf.
Need your tub or bathroom fixed?
Forget it. You gotta wait MONTHS.
The roof & siding industry was doing booming business (still is) here in ND bcs of the bad hail storms last summer.
But there still weren’t enough contractors.
People are STILL waiting to get their homes sided/finished & their roofs replaced/finished.
Outfits from IA & TX came up here.
I could name more instances.
Contractors need to go where the work is at.
There’s at least some work up here to do.

BTW Do you all know how many H1-B guest worker visas are issued by the government every year and how long they are good for?
Does anyone know why we haven’t canceled them?
(A: 65,000 per year, 5 years) High tech companies are still claiming they can’t find enough qualified help and no one calls them on that lie either.
The entire H1-B situation is a gigantic scam that no one wants to talk about.
dogsoldier on February 4, 2011 at 9:34 AM

From what I’ve known, there are not enough Americans graduating with engineering etc degrees to fill the demand.
And while it is true that it is used to some extend to drive down wages, well, for every 1 American engineers there might be 100 Indian ones.
I also see this problem with worker visas for agriculture.
It’s crass, but these foreigners from places like S Africa are willing to do the agricultural work Americans refuse to do.
You simply make more $$ staying at home & collecting welfare benefits.

I’ve always thought that any person on welfare or food stamps should be given the name of a taxpayer that they are required to write a thank-you letter to.
slickwillie2001 on February 4, 2011 at 11:35 AM

I was on welfare & food stamps for 3 months one time.
It was the most humiliating time in my life.
People have no shame anymore.
They are without pride or manners.

Adding 36,000 jobs and decreasing the unemployment rate by 0.4% means that a country of 281,421,906 (2000 census) is being supported by a workforce of only 9,000,000 people. That’s only 3.1% of the population!

Believe me there are plenty of US citizens who are engineers to fill the demand. I have been a hiring manager of one kind or another several times and when I have put out an ad or called the agencies I received many resumes.

The problem is the H1-b shops (the h1 is only for skilled workers by the way. Agro workers have their own Guest worker program. There are four or five such programs running last I checked). H1 shops are companies that only hire H1-B workers. I know of three such places in mass and NH.

They will not hire a US citizen. Even the managers are from other countries.

Another problem is the Employer Job Spec “Laundry List” of required skills and experience. By doing this employers can and do claim they cannot find qualified people.

Have you coded C++ for twenty years? Then you couldn’t possibly be any good at C sharp or Java. Which is complete nonsense.

Believe me there are plenty of US citizens who are engineers to fill the demand. I have been a hiring manager of one kind or another several times and when I have put out an ad or called the agencies I received many resumes.

dogsoldier on February 4, 2011 at 5:13 PM

Agree there are. If you look at unemployment figures by profession, there’s not much difference between engineering and the averages.

When a company goes for an H1B, they have to show that they advertised the position to in the USA first. That place for that advertisement is usually the coffee room of the employer doing the hiring, and in a newspaper in a bare anonymous two-liner in the smallest print available.

Why in the world would I believe the MSM about unemployment stats when the ones that have been out of work and exhausted their unemployment checks are not counted? It’s right in front of the readers but they don’t understand. How can a 9.6 figure go on and on while more and more people are unemployed? The public reads but has no sense in putting the numbers together to come up with a true number. We are programed to believe what ever comes out of the White House is gospel. Unbelievable!

A supplemental table in the January jobs report which attempts to apply the new population estimates back to 2010, Table C, shows a big increase in employment and a small increase in people leaving the labor force from December to January. But it doesn’t provide a clear picture of the trend in employment and unemployment levels either, says Jim Borbely, a Bureau of Labor Statistics economist. That’s because it piles all of the new, lower population and employment estimates to December 2010 rather than spreading them out among earlier months. This makes it look like there were big swings in these levels that might not have occurred all at once.

This market is insane. It goes up when the latest economic reports are good, or bad, or indifferent. It goes up when the bond market is up, or down, or flat. It goes up no matter what happens with oil and energy, no matter what happens with food, no matter what happens, period. It goes up when gold and commodities are rising, usually a contra-indicator. When the dollar is falling, ditto. When deficits are rising. No matter who wins what political office. No matter what happens in the Middle East.

One of the clearest signals of an inflating “bubble” is that it continues to grow despite bad news. It means it will burst, probably fairly soon. Don’t get any on ya.

That’s something that US citizens would normally have gotten. Not so much the lower pay, but that the training reserved for these folks would have been directed towards US citizens (who were a closer fit than those H1’s, not including any misrepresentation).

slickwillie2001 on February 4, 2011 at 5:26 PM

Even before offshoring became such a well-known term, there was trouble already known about the H1-b program. That is, there already was knowledge that the program wasn’t being enforced well enough. If there’s a regulation or two I want to see gone, it’d be 20 CFR 655 & 20 CFR 656; without those two, you’d be able to get rid of a ton of the fraud. It’d not be good for those who had business models that predicated on fraud or avoiding US citizens, but they can adapt.

The odd thing is that there was another number in the early 1990’s (U-7) that would show the 20-22% you see today. For what it tracked, it was the “long-term discouraged” number – it tracked the kinds of people that have been “left behind” in the economy.